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Higher insolvency rate for women reflects 'gender inequality in economy'

Women were more likely than men to see their finances deteriorate so badly that they became insolvent last year, official figures show.

Continuing a trend that started in 2014, the personal insolvency rate for women across England and Wales was higher in 2015 than it was for men, according to the Insolvency Service.

The personal insolvency rate per 10,000 adults was 18.2 for women in 2015, while for men the rate was 16.9.

Experts said the figures were evidence of women being more exposed than men to financial shocks.

The main factor behind the higher rate for women was that they were more likely to take out a type of personal insolvency called a debt relief order (DRO).

DROs are often dubbed "bankruptcy light". They are aimed at people with lower amounts of debt, of up to £20,000, but no realistic prospect of paying it off.

There are two other types of personal insolvency included in the figures - bankruptcies and individual voluntary arrangements (IVAs), which are arrangements to share money out between creditors.

Insolvency rates generally have been on a downward path in recent years, with low interest rates helping to keep the cost of people's borrowing down.

But the Insolvency Service said the decrease in insolvency rates had fallen more sharply for men than it had for women over the last six years.

Historically, men were consistently more likely to go insolvent than women, but the gap narrowed from 2009 - the same year that DROs were introduced.

Looking across different age groups, the Insolvency Service said women were now more likely to go insolvent than men up until the age of 55. Men aged 55 and over were still more likely to go insolvent than women of the same age. Both women and men were particularly likely to go insolvent when they were aged between 35 and 44-years-old.

Adrian Hyde, vice-president of insolvency trade body R3, said the figures reflected " a large degree of gender inequality in the economy".

He said: "Women may be more prone to insolvency, but this is probably linked to the fact that they tend to have lower levels of assets or incomes to live on than men.

"They are also much more likely to be financially dependent on someone else. It's a lot easier to 'over-spend' or be exposed to a financial shock in this situation."

Across England and Wales, the research found that many seaside towns were particularly likely to have high insolvency rates compared with the country as a whole, while rates tended to be lower in areas of London and South East England.

Torbay had the highest rate, at 38.4 per 10,000 adults - more than twice the England and Wales average rate of 17.6.

Scarborough, Plymouth and Blackpool were also among the areas with the highest insolvency rates.

The local authority with lowest rate of total insolvencies was Epsom and Ewell with six insolvencies per 10,000 adults - less than half the England and Wales average.

Here are the local authority areas with the lowest insolvency rates in 2015 across England and Wales according to Insolvency Service figures, with the rate per 10,000 adults:

1. Epsom and Ewell, 6.0

2. Westminster, 6.9

3. Wokingham, 7.4

4. Hart, 7.6

=5. Kensington and Chelsea, 8.2

=5. Mole Valley, 8.2

=5. Harborough, 8.2

8. Wandsworth, 8.3

=9. Kingston upon Thames, 8.5

=9. Runnymede, 8.5

And here are the local authority areas with the highest insolvency rates, with the rate per 10,000 adults:

1. Torbay, 38.4

2. Kingston upon Hull, 36.7

3. Stoke on Trent, 35.5

4. Scarborough, 35.3

5. Isle of Wight, 32.5

6. Gloucester, 32.0

7. Ipswich, 30.9

=8. Harlow, 30.3

=8. Plymouth, 30.3

=8. Blackpool, 30.3

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